11 December 1989 Internal T.I. 74367 F - Transport Employees' Away-from-home Expenses

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Subject: Paragraph 8(1)(g) of the Income Tax Act (the "Act") Transport Employees' Away From-Home Expenses

This is in reply to your memorandum dated September 22, 1989, wherein you have asked whether the Department's assessing practices concerning paragraph 8(1)(g) of the Act are correct, and if so, whether the Act should be amended to reflect the Department's interpretation. You have also asked whether the original intent of the legislation was to assist only those employees whose job related travel requirements were such as to incur both meals and lodging expenses. You have determined that if the original intent of the legislation was to accommodate only those transport employees incurring both meals and lodging expenses (and who otherwise meet the requirements of paragraph 8(1)(g) of the Act), then our administrative practices should be changed and the public notified.

The Department has historically interpreted the clause "to make disbursements for meals and lodging" as found in subparagraph 8(1)(g)(ii) of the Act to mean disbursements for meals or lodging or meals and lodging, as the case may be. Information Circular IC73-21R6, in particular paragraph 16, clearly indicates that a claim for meals only is acceptable.

21(1)(b)

Our research has indicated that the original intent of the legislation, when introduced in the 1948 Budget, was to provide relief to certain employees in the transportation industry. Specifically, it was aimed at the "overnight" employee (railway conductors, porters, sleeping-car conductors and so forth) and more specifically, the "overnight" employee employed by the railways as that industry traditionally did not include any provisions for board and lodging expenses in its wage scale. However, our research has also shown that we have administratively accepted claims for meals only for those transport employees who otherwise qualify under paragraph 8(1)(g) of the Act since as early as 1952 and perhaps even prior to that date.

21(1)(b)

We have reviewed the jurisprudence as it relates to 8(1)(g) of the Act and have found no cases where the interpretation of "and" in "meals and lodging" is primary to the decision rendered. We noted that in both Fraser v MNR, 71 DTC 24 and Anderson v MNR, 69 DTC 636, the Tax Appeal Board indicated that meal disbursements only were sufficient for a deduction under paragraph 8(1)(g) of the Act where the employee otherwise qualified.

On the other hand, the comments in Derrien would appear to reflect the original intent of the legislation: "When paragraph 8(1)(g) refers to travelling away from a municipality and its metropolitan area it contemplates journeys of such substantial distance and duration as to require disbursements for both meals and lodging".

21(1)(b)

We trust that the above comments will be of assistance to you.

B.W. DathDirectorBusiness and General DivisionSpecialty Rulings DirectorateLegislative and IntergovernmentalAffairs Branch